"We are holding talks which, I hope, will be a success, and we will make a final decision this month," Viktor Vekselberg said during a meeting with President Vladimir Putin.
The merger will create a Russian aluminum monopoly and the world's leading producer of primary aluminum.
Vekselberg said SUAL was considering two development options. The first scenario is to advance on its own towards an initial public offering. "The second scenario being considered, and which is the preferred one, is to form an alliance with RusAl and a third company, Glencore."
Swiss-based Glencore is the world's largest supplier of commodities and raw materials to industrial consumers.
Kommersant, a leading Russian business daily, said last month that RusAl and SUAL, which will control 100% of Russia's aluminum market, will have no problem obtaining permission from the Federal Anti-Monopoly Service.
The new law on the protection of competition does not oppose such mergers if they contribute to strengthening Russian producers on the world market, Kommersant says.
Vekselberg said the alliance will pave the way to a leading world position, and will allow the takeover of additional assets through the placement of shares on world markets.
He said it was time for SUAL and RusAl to expand overseas as "we have approached the moment in the aluminum sector when consolidation inside the country can be considered complete."
Founded in March 2000 following a merger of major aluminum plants in the former Soviet Union, RusAl exports aluminum to 50 countries and operates in nine Russian regions and 13 countries. The company holds 75% of the Russian market and 10% of the international market.
One of the world's top 10 aluminum companies, SUAL has enterprises in nine Russian regions and in Ukraine, and annually mines over 5.4 million metric tons of bauxite, some 2.3 mln metric tons of alumina, over 1 mln tons of primary aluminum, and about 60,000 metric tons of silicon.
It also manufactures aluminum products, including foil, wire, and wheel rims, and exports 80% of its production.